Steak ‘N Shake, Essay Example

Steak ‘N Shake is a subsidiary of Biglari Holdings, thus, it does not file separate financial statements with the SEC. All data comes from Biglari Holdings’ 10-K statement from the last fiscal year which was 2011. Biglari Holdings’s largest long-term liability is its obligations under leasing agreements which total a little over $116 million. It can be safely assumed that most of these leases are related to Steak ‘N Shake’s outlets. Other major liabilities include long-term debt at little over $101 million and largest short term liability is accrued expenses at approximately $47 million. As far as short-terms assets are concerned, Biglari Holding’s accounts receivables (A/R) are slightly over $4.1 million and the total value of inventories stand at approximately $5.89 million (Biglari Holdings).

The company’s largest intangible asset is goodwill with a total value of approximately $27.53 million. Other tangible assets are valued at $6.95 million, putting the combined value of all intangible assets at approximately $34.48 million. The company’s total liabilities are approximately $348 million while total shareholders’ equity is nearly $280 million, indicating a greater preference for debt in the capital structure (Biglari Holdings). This is not surprising because Steak N’ Shake is one of the company’s major holdings and restaurant business requires substantial investment in retail outlets. Not surprisingly, the largest long-term liability is leasing agreements which total $116 million. If we remove leasing agreements, the capital structure would become equity-intensive.

Reference

Biglari Holdings. “10-K.” Financial Statement. 2011.